OPEC’s Poker Face S5 | Ep 39

World of Oil Derivatives

Onyx Research Associate Martha Downing joins CEO Greg Newman with a market update and the pair discuss how the markets were affected pre and post OPEC meeting.
Martha informs us how the refinery margin changed. Crude and the products are still weak and gasoil is weighing down the margins in both regions. The end of last month saw players holding their MOPJ, which is Asian naphtha into pricing, which is going to continue to bolster the spread.
Martha recommends MOC in gasoline as her one to watch. In the east, we have seen the RON 92 gasoline MOC (market on close) flow was almost ubiquitously well bid with strong buying seen in the windows. There have been slightly contrasting flows in the paper contracts outside of this. The strong flow and sentiment have been from the sell-side, with two European trade houses selling consistently, in good volume with market makers buying the spreads well.
And the Trade Idea of the week is to go long the Q1 Euro naphtha crack. The Q1 crack has seen great support recently and rose to highs of $8.65 per barrel on December 5th. Although this seems very high compared to the almost $14 per barrel level it was trading at a couple of months ago, it remains fairly low, historically.
Links below to Greg and Martha’s LinkedIn pages:
Greg Newman: https://www.linkedin.com/in/oilderivatives/
Martha Dowding: https://www.linkedin.com/in/martha-dowding-ab84801a6/